Time series properties of the Romanian listed firms’ capital structure
Time series properties of the Romanian listed firms’ capital structure

Summary/Abstract: The purpose of this paper was to investigate the impact of the macroeconomic conditions on the capital structure of the Romanian firms listed on the Bucharest Stock Exchange during the period 2004-2012. We used quarterly time series and the methodology developed by Pesaran, Shin and Smith (2001) to examine the relationships between capital structure and macroeconomic variables in an autoregressive distributed lag (ARDL) framework. The dependent variable was the average debt ratio of the Romanian firms listed on the Bucharest Stock Exchange, and the independent variables were inflation rate, Central Bank interest rate and GDP growth. The results indicated that there is no long-run relationship between the debt ratio of the Romanian listed firms and the aforementioned independent variables. On the short-run, there was found a positive significant relationship between the debt ratio of the Romanian firms and the inflation rate

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